The two methods of accounting for uncollectible receivables are the direct write-off method and the:

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The allowance method is considered the best method for accounting for uncollectible receivables as it matches the estimated loss from uncollectible accounts with the revenue recognized in the same period. The direct write-off method, on the other hand, recognizes bad debt expense only when it is deemed uncollectible, making it an inaccurate method of accounting for uncollectible receivables. The other options, equity method, interest method, and cost method, are not relevant to accounting for uncollectible receivables.

The Two Methods of Accounting for Uncollectible Receivables Are the Direct